Company Was “Impersonated” in a $100 Million Fraud Scheme

Can a company experience identify theft? According to this recent article, some fraudsters found a way to impersonate a legitimate vendor in a $100 million fraud scheme. A Taiwan-based electronics manufacturer acknowledged that its name was used in an email fraud scheme that defrauded two U.S.-based internet companies out of over $100 million. A Lithuanian man schemed to receive wired funds from two internet companies, who believed they were paying legitimate bills to a vendor with which they regularly worked. The man used forged invoices, contracts and letters to conceal his fraud from the banks that handled the transfers.

What can we learn from this unique fraud scheme?

  • Standard communication. Do you usually receive an email requesting payment? Or is it a hard copy invoice? If you notice a break in the usual cycle, contact the vendor directly to check the invoice’s authenticity.
  • Usual Contact. Is the email from the sender who usually communicates with you regarding payment? Make sure the email address is the same too, as some scams involve using a known vendor name, but with a slightly different domain name or email address.
  • Banking information. Determine whether banking information is different from previous payment information.

Always question when something seems out of the ordinary. If you suddenly start receiving emails for payment and you don’t recognize the email name or address, verify with your contact at the vendor to ensure that they are the ones sending you the email.

For more information on fraud prevention or detection in your organization, contact Mike Rosten, CPA, CFE.